[Federal Register Volume 73, Number 143 (Thursday, July 24, 2008)]
[Rules and Regulations]
[Pages 43053-43056]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-16956]



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 Rules and Regulations
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  Federal Register / Vol. 73, No. 143 / Thursday, July 24, 2008 / Rules 
and Regulations  

[[Page 43053]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 916 and 917

[Docket No. AMS-FV-07-0160; FV08-916/917-1 FIR]


Nectarines and Peaches Grown in California; Changes in Handling 
Requirements for Fresh Nectarines and Peaches

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Department of Agriculture is adopting, as a final rule, 
with a change, an interim final rule changing the handling requirements 
applicable to well matured fruit covered under the nectarine and peach 
marketing orders (orders). The orders regulate the handling of 
nectarines and peaches grown in California and are administered locally 
by the Nectarine Administrative and Peach Commodity Committees 
(committees). This rule continues in effect the action that updated the 
variety-specific size requirements to reflect changes in commercially 
significant varieties. This will enable handlers to continue to ship 
fresh nectarines and peaches in a manner that meets consumer needs, 
increases returns to producers and handlers, and reflects current 
industry practices.

DATES: Effective Date: August 25, 2008.

FOR FURTHER INFORMATION CONTACT: Jennifer Garcia, Marketing Specialist, 
or Kurt J. Kimmel, Regional Manager, California Marketing Field Office, 
Marketing Order Administration Branch, Fruit and Vegetable Programs, 
AMS, USDA; Telephone: (559) 487-5901, Fax: (559) 487-5906; or E-mail: 
[email protected] or [email protected].
    Small businesses may request information on complying with this 
regulation by contacting Jay Guerber, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 Independence 
Avenue, SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 
720-2491, Fax: (202) 720-8938, or E-mail: [email protected].

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing Order 
Nos. 916 and 917, both as amended (7 CFR parts 916 and 917), regulating 
the handling of nectarines and peaches grown in California, 
respectively, hereinafter referred to as the ``orders.'' The orders are 
effective under the Agricultural Marketing Agreement Act of 1937, as 
amended (7 U.S.C. 601-674), hereinafter referred to as the ``Act.''
    The Department of Agriculture (USDA) is issuing this rule in 
conformance with Executive Order 12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule is not intended to have retroactive effect. 
This rule will not preempt any State or local laws, regulations, or 
policies, unless they present an irreconcilable conflict with this 
rule.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 608c(15)(A) of the 
Act, any handler subject to an order may file with USDA a petition 
stating that the order, any provision of the order, or any obligation 
imposed in connection with the order is not in accordance with law and 
request a modification of the order or to be exempted therefrom. A 
handler is afforded the opportunity for a hearing on the petition. 
After the hearing, USDA would rule on the petition. The Act provides 
that the district court of the United States in any district in which 
the handler is an inhabitant, or has his or her principal place of 
business, has jurisdiction to review USDA's ruling on the petition, 
provided an action is filed not later than 20 days after the date of 
the entry of the ruling.
    This rule continues in effect the action that modified handling 
requirements applicable to well matured fruit covered under the 
nectarine and peach orders. It also continues in effect the action that 
updated variety-specific size requirements to reflect changes in 
commercially significant varieties. These changes enable handlers to 
continue to ship fresh nectarines and peaches in a manner that meets 
consumer needs, increases returns to producers and handlers, and 
reflects current industry practices.
    Sections 916.52 and 917.41 of the orders provide authority for 
handling regulations for fresh California nectarines and peaches. The 
regulations may include grade, size, maturity, quality, pack, and 
container requirements. The orders also provide that whenever such 
requirements are in effect, the fruit subject to such regulation must 
be inspected by the Federal or Federal-State Inspection Service 
(Inspection Service) and certified as meeting the applicable 
requirements.
    The nectarine order has been in effect since 1939, and the peach 
program has been in effect since 1958. The orders have been used over 
the years to establish a quality control program that includes minimum 
grades, sizes, and maturity standards. That program has helped improve 
the quality of product moving from the farm to market, and has helped 
growers and handlers more effectively market their crops. Additionally, 
the orders have been used to ensure that only satisfactory quality 
nectarines and peaches reach the consumer. This has helped increase and 
maintain market demand over the years.
    Sections 916.53 and 917.42 authorize the modification, suspension, 
or termination of regulations issued under Sec. Sec.  916.52 and 
917.41, respectively. Changes in regulations have been implemented to 
reflect changes in industry operating practices and to solve marketing 
problems as they arise. The committees meet whenever needed, but at 
least annually, to discuss the orders and the various regulations in 
effect and to determine if, or what, changes may be necessary to 
reflect industry needs. As a result, regulatory changes have been made 
numerous times over the years to address industry changes and to 
improve program operations.
    Currently, handling requirements are in effect for nectarines and 
peaches packed in containers marked ``CA WELL MAT'' or ``California 
Well Matured.'' The term ``well matured'' is defined in the orders' 
rules and regulations, and has been used for many years by the

[[Page 43054]]

industry to describe a level of maturity higher than the definition of 
``mature'' in the United States Standards for Grades of Nectarines (7 
CFR 51.3145 through 51.3160) and United States Standards for Grades of 
Peaches (7 CFR 51.1210 through 51.1223). Other handling requirements 
were suspended in 2007 to reduce handler inspection costs.
    The committees met on December 18, 2007, and unanimously 
recommended that the handling requirements be revised for the 2008 
season, which began in April. The committees announced a crop estimate 
of 21,000,000 containers of nectarines and 23,500,000 containers of 
peaches at their April 29, 2008, meetings.
    Both orders provide authority (in Sec. Sec.  916.52 and 917.41) to 
establish size requirements. Size regulations encourage producers to 
leave fruit on the tree longer, which improves both the size and 
maturity of the fruit. Acceptable fruit size provides greater consumer 
satisfaction and promotes repeat purchases, thereby increasing returns 
to producers and handlers. In addition, increased fruit size results in 
increased numbers of packed containers of nectarines and peaches per 
acre, which is also a benefit to producers and handlers.
    Varieties recommended for specific size regulations have been 
reviewed and such recommendations are based on the specific 
characteristics of each variety. The committees conduct studies each 
season on the range of sizes attained by the regulated varieties and 
those varieties with the potential to become regulated, and determine 
whether revisions to the size requirements are appropriate.
    Nectarines: Section 916.356 of the order's rules and regulations 
specifies minimum size requirements for fresh nectarines in paragraphs 
(a)(2) through (a)(9). This rule continues in effect the action that 
revised paragraphs (a)(3), (a)(4), and (a)(6) of Sec.  916.356 to 
establish variety-specific minimum size requirements for 11 varieties 
of nectarines that were produced in commercially significant quantities 
of more than 10,000 containers for the first time during the 2007 
season. This rule also continues in effect the action that removed the 
variety-specific minimum size requirements for four varieties of 
nectarines whose shipments fell below 5,000 containers during the 2007 
season.
    For example, one of the varieties recommended for addition to the 
variety-specific minimum size requirements is the Burnecteleven (Summer 
Flare[supreg] 30) variety of nectarines, recommended for regulation at 
a minimum size 84. A minimum size of 84 means that a packed standard 
lug box will contain not more than 84 nectarines. Studies of the size 
ranges attained by the Burnecteleven (Summer Flare[supreg] 30) variety 
revealed that 100 percent of the containers met the minimum size of 84 
during the 2006 and 2007 seasons. Sizes ranged from size 30 to size 70, 
with 9.6 percent of the fruit in the 30 sizes, 50 percent of the 
packages in the 40 sizes, 32.9 percent in the 50 sizes, 6.2 percent in 
the 60 sizes, and 1.3 percent in the 70 sizes.
    A review of other varieties with the same harvesting period 
indicated that the Burnecteleven (Summer Flare[supreg] 30) variety was 
also comparable to those varieties in its size ranges for that time 
period. Discussions with handlers known to handle the variety confirm 
this information regarding minimum size and harvesting period, as well. 
Thus, the recommendation to place the Burnecteleven (Summer 
Flare[supreg] 30) variety in the variety-specific minimum size 
regulation at a minimum size 84 is appropriate. This recommendation 
results from size studies conducted over a two-year period.
    Historical data such as this provides the committee with the 
information necessary to recommend the appropriate sizes at which to 
regulate various nectarine varieties. In addition, producers and 
handlers of the varieties affected are personally invited to comment 
when such size recommendations are deliberated. Producer and handler 
comments are also considered at both committee and subcommittee 
meetings when the staff receives such comments, either in writing or 
verbally.
    For reasons similar to those discussed in the preceding paragraph, 
paragraph (a)(3) of Sec.  916.356 was revised to include the Polar Ice 
and Polar Light nectarine varieties; paragraph (a)(4) of Sec.  916.356 
was revised to include the Burnectthirteen (Snow Flare[supreg] 22), 
Burnectfourteen (Snow Flare[supreg] 21), and White Sun nectarine 
varieties; and paragraph (a)(6) of Sec.  916.356 was revised to include 
the Burnecteleven (Summer Flare[supreg] 30), Burnectfifteen (Summer 
Flare[supreg] 27), Grand Bright, La Reina, Saucer, and Sugar Pearl\TM\ 
nectarine varieties.
    This rule also continues in effect the action that revised 
paragraph (a)(6) of Sec.  916.356 to remove the August Snow, Prima 
Diamond XVIII, Sparkling Red, and Summer Grand nectarine varieties from 
the variety-specific minimum size requirements because fewer than 5,000 
containers of each of these varieties were produced during the 2007 
season. Nectarine varieties removed from the nectarine variety-specific 
minimum size requirements become subject to the non-listed variety size 
requirements specified in paragraphs (a)(7), (a)(8), and (a)(9) of 
Sec.  916.356.
    Peaches: Section 917.459 of the order's rules and regulations 
specifies minimum size requirements for fresh peaches in paragraphs 
(a)(2) through (a)(6), and paragraphs (b) and (c). This rule continues 
in effect the action that revised paragraphs (a)(2), (a)(3), (a)(5), 
and (a)(6) of Sec.  917.459 to establish variety-specific minimum size 
requirements for 15 peach varieties that were produced in commercially 
significant quantities of more than 10,000 containers for the first 
time during the 2007 season. This rule also continues in effect the 
action that removed the variety-specific minimum size requirements for 
eight varieties of peaches whose shipments fell below 5,000 containers 
during the 2007 season.
    For example, one of the varieties recommended for addition to the 
variety-specific minimum size requirements is the Super Lady variety of 
peaches, which was recommended for regulation at a minimum size 96. A 
minimum size of 96 means that a packed standard lug box contains not 
more than 96 peaches. Studies of the size ranges attained by the Super 
Lady variety revealed that 98.9 percent of the containers met the 
minimum size of 96 during the 2006 and 2007 seasons. The sizes ranged 
from size 40 to size 96, with 6.9 percent of the containers meeting the 
size 40, 4 percent meeting the size 50, 20.5 percent meeting the size 
60, 29.8 percent meeting the size 70, 15.6 percent meeting the size 80, 
4.5 percent meeting the size 84, 4.9 percent meeting the size 88, and 
12.7 percent meeting the size 96 in the 2007 season.
    A review of other varieties with the same harvesting period 
indicated that the Super Lady variety was also comparable to those 
varieties in its size ranges for that time period. Discussions with 
handlers known to pack the variety confirm this information regarding 
minimum size and the harvesting period, as well. Thus, the 
recommendation to place the Super Lady variety in the variety-specific 
minimum size regulation at a minimum size 96 is appropriate.
    Historical data such as this provides the committee with the 
information necessary to recommend the appropriate sizes at which to 
regulate various peach varieties. In addition, producers and handlers 
of the varieties affected are personally invited to comment when

[[Page 43055]]

such size recommendations are deliberated. Producer and handler 
comments are also considered at committee meetings when the staff 
receives such comments, either in writing or verbally.
    For reasons similar to those discussed in the preceding paragraph, 
paragraph (a)(2) of Sec.  917.459 was revised to include the 
Supechfifteen and Super Lady peach varieties; paragraph (a)(5) of Sec.  
917.459 was revised to include the Crimson Queen, Sauzee Queen, and 
Supechnine peach varieties; and paragraph (a)(6) of Sec.  917.459 was 
revised to include the Burpeachtwentyone (Summer Flame[supreg] 26), 
Candy Princess, Jasper Flame, Natures 10, Peach-N-Cream, Queen 
Jewel, September Blaze, Strawberry, Summer Fling, and Sweet Henry peach 
varieties.
    This rule also continues in effect the action that revised 
paragraph (a)(2) of Sec.  917.459 to remove the Sugar Snow peach 
variety; paragraph (a)(3) of Sec.  917.459 to remove the May Snow peach 
variety; paragraph (a)(5) of Sec.  917.459 to remove the Raspberry, 
Sugar Jewel, and Sunlit Snow peach varieties; and paragraph (a)(6) of 
Sec.  917.459 to remove the Late Ito Red, Magenta Gold, and Scarlet 
Snow peach varieties from the variety-specific minimum size 
requirements because less than 5,000 containers of each of these 
varieties was produced during the 2007 season. Peach varieties removed 
from the peach variety-specific minimum size requirements become 
subject to the non-listed variety size requirements specified in 
paragraphs (b) and (c) of Sec.  917.459.
    The committees recommended these changes in the minimum size 
requirements based on a continuing review of the sizing and maturity 
relationships for these nectarine and peach varieties, and the consumer 
acceptance levels for various fruit sizes. This rule is designed to 
establish minimum size requirements for fresh nectarines and peaches 
consistent with expected crop and market conditions. This should help 
establish and maintain orderly marketing conditions for these fruits in 
the interests of producers, handlers, and consumers.

Final Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
economic impact of this action on small entities. Accordingly, AMS has 
prepared this final regulatory flexibility analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and rules issued thereunder, are unique in that 
they are brought about through group action of essentially small 
entities acting on their own behalf. Thus, both statutes have small 
entity orientation and compatibility.

Industry Information

    There are approximately 145 California nectarine and peach handlers 
subject to regulation under the orders covering nectarines and peaches 
grown in California, and about 550 producers of these fruits in 
California. Small agricultural service firms, which include handlers, 
are defined by the Small Business Administration (SBA) (13 CFR 121.201) 
as those whose annual receipts are less than $6,500,000. Small 
agricultural producers are defined by the SBA as those having annual 
receipts of less than $750,000. A majority of these handlers and 
producers may be classified as small entities.
    The committees' staff has estimated that there are fewer than 30 
handlers in the industry who would not be considered small entities. 
For the 2007 season, the committees' staff estimated that the average 
handler price received was $9.00 per container or container equivalent 
of nectarines or peaches. A handler would have to ship at least 722,223 
containers to have annual receipts of $6,500,000. Given data on 
shipments maintained by the committees' staff and the average handler 
price received during the 2007 season, the committees' staff estimates 
that small handlers represent approximately 80 percent of all the 
handlers within the industry.
    The committees' staff has also estimated that fewer than 65 
producers in the industry would not be considered small entities. For 
the 2007 season, the committees estimated the average producer price 
received was $4.50 per container or container equivalent for nectarines 
and peaches. A producer would have to produce at least 166,667 
containers of nectarines and peaches to have annual receipts of 
$750,000. Given data maintained by the committees' staff and the 
average producer price received during the 2007 season, the committees' 
staff estimates that small producers represent more than 88 percent of 
the producers within the industry.
    With an average producer price of $4.50 per container or container 
equivalent, and a combined packout of nectarines and peaches of 
42,382,098 containers, the value of the 2007 packout is estimated to be 
$190,719,441. Dividing this total estimated grower revenue figure by 
the estimated number of producers (550) yields an estimate of average 
revenue per producer of about $346,763 from the sales of peaches and 
nectarines.
    Under authority provided in Sec. Sec.  916.52 and 917.41 of the 
orders, grade, size, maturity, pack, and container marking requirements 
are established for fresh shipments of California nectarines and 
peaches, respectively. Such requirements are in effect on a continuing 
basis.
    Sections 916.356 and 917.459 of the orders' rules and regulations 
establish minimum sizes for various varieties of nectarines and 
peaches. This rule continues in effect the action that made adjustments 
to the minimum sizes authorized for certain varieties of each commodity 
for the 2008 season. Minimum size regulations are put in place to 
encourage producers to leave fruit on the trees for a longer period of 
time, increasing both maturity and fruit size. Increased fruit size 
increases the number of packed containers per acre, and coupled with 
heightened maturity levels, also provides greater consumer 
satisfaction, which in turn fosters repeat purchases that benefit 
producers and handlers alike.
    Annual adjustments to minimum sizes of nectarines and peaches, such 
as these, are recommended by the committees based upon historical data, 
producer and handler information regarding sizes attained by different 
varieties, and trends in consumer purchases.
    An alternative to such action would include not establishing 
minimum size regulations for these new varieties. Such an action, 
however, would be a significant departure from the committees' past 
practices and represent a significant change in the regulations as they 
currently exist. For these reasons, this alternative was not 
recommended.
    The committees make recommendations regarding the revisions in 
handling requirements after considering all available information, 
including comments received by committee staff. At the meetings, the 
impact of and alternatives to these recommendations are deliberated. 
The committees consist of individual producers and handlers with many 
years of experience in the industry who are familiar with industry 
practices and trends. All committee meetings are open to the public and 
comments are widely solicited. In addition, minutes of all meetings are 
distributed to committee members and others who have requested them, 
and are also available on the committees' Web site, thereby

[[Page 43056]]

increasing the availability of this critical information within the 
industry.
    Regarding the impact of this action on the affected entities, both 
large and small entities are expected to benefit from the changes, and 
the costs of compliance are not expected to be significantly different 
between large and small entities.
    This rule will not impose any additional reporting or recordkeeping 
requirements on either small or large nectarine and peach handlers. As 
with all Federal marketing order programs, reports and forms are 
periodically reviewed to reduce information requirements and 
duplication by industry and public sector agencies.
    AMS is committed to complying with the E-Government Act, to promote 
the use of the Internet and other information technologies to provide 
increased opportunities for citizen access to Government information 
and services, and for other purposes.
    In addition, as noted in the initial regulatory flexibility 
analysis, USDA has not identified any relevant Federal rules that 
duplicate, overlap, or conflict with this rule.
    Further, the committees' meetings were widely publicized throughout 
the nectarine and peach industry and all interested parties were 
invited to attend the meetings and participate in committee 
deliberations. Like all committee meetings, the December 18, 2007, 
meetings were public meetings and all entities, both large and small, 
were able to express their views on this issue.
    Also, the committees have a number of appointed subcommittees to 
review certain issues and make recommendations to the committees. The 
committees' Tree Fruit Quality Subcommittee met on December 11, 2007, 
and discussed this issue in detail. That meeting was also a public 
meeting and both large and small entities were able to participate and 
express their views.
    An interim final rule concerning this action was published in the 
Federal Register on March 18, 2008. Copies of the rule were posted on 
the committees' Web site. In addition, the rule was made available 
through the Internet by USDA and the Office of the Federal Register. 
That rule provided a 60-day comment period which ended May 19, 2008. 
One comment was received from the committees' staff. The comment stated 
that the trademark name for the currently regulated Burpeachsixteen 
variety had been established as ``Spring Flame[supreg] 24.'' Section 
917.459(a)(6) has been modified to include the new trademark name.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at the 
following Web site: http://www.ams.usda.gov/AMSv1.0/ams.fetchTemplateData.do?template=TemplateN&page=MarketingOrdersSmallBusinessGuide. Any questions about the compliance guide should be sent to 
Jay Guerber at the previously mentioned address in the FOR FURTHER 
INFORMATION CONTACT section.
    After consideration of all relevant material presented, including 
the committees' recommendations, and other information, it is found 
that finalizing this interim final rule, with a change, as published in 
the Federal Register (73 FR 14372, March 18, 2008) will tend to 
effectuate the declared policy of the Act.

List of Subjects

7 CFR Part 916

    Marketing agreements, Nectarines, Reporting and recordkeeping 
requirements.

7 CFR Part 917

    Marketing agreements, Peaches, Pears, Reporting and recordkeeping 
requirements.

0
Accordingly, the interim final rule amending 7 CFR parts 916 and 917 
which was published at 73 FR 14372 on March 18, 2008, is adopted as a 
final rule with the following change:

PART 917--FRESH PEARS AND PEACHES GROWN IN CALIFORNIA

0
1. The authority citation for part 917 continues to read as follows:

    Authority: 7 U.S.C. 601-674.


0
2. Section 917.459 is amended by revising the introductory text of 
paragraph (a)(6) to read as follows:


Sec.  917.459  California peach grade and size regulation.

* * * * *
    (6) Any package or container of August Lady, Autumn Flame, Autumn 
Red, Autumn Rich, Autumn Rose, Autumn Snow, Burpeachtwo (Henry 
II[supreg]), Burpeachthree (September Flame[supreg]), Burpeachfour 
(August Flame[supreg]), Burpeachfive (July Flame[supreg]), Burpeachsix 
(June Flame[supreg]), Burpeachseven (Summer Flame[supreg] 29), 
Burpeachfifteen (Summer Flame[supreg] 34), Burpeachsixteen (Spring 
Flame[supreg] 24), Burpeachtwenty (Summer Flame[supreg]), 
Burpeachtwentyone (Summer Flame[supreg] 26), Candy Princess, Coral 
Princess, Country Sweet, Diamond Princess, Earlirich, Early Elegant 
Lady, Elegant Lady, Fancy Lady, Fay Elberta, Full Moon, Galaxy, Glacier 
White, Henry III, Henry IV, Ice Princess, Ivory Princess, Jasper Flame, 
Jasper Treasure, Jillie White, Joanna Sweet, John Henry, Kaweah, 
Klondike, Last Tango, Natures 10, O'Henry, Peach-N-Cream, Pink 
Giant, Pink Moon, Prima Gattie 8, Prima Peach 13, Prima Peach XV, Prima 
Peach 20, Prima Peach 23, Prima Peach XXVII, Princess Gayle, Queen 
Jewel, Rich Lady, Royal Lady, Ruby Queen, Ryan Sun, Saturn (Donut), 
September Blaze, September Snow, September Sun, Sierra Gem, Sierra 
Rich, Snow Beauty, Snow Blaze, Snow Fall, Snow Gem, Snow Giant, Snow 
Jewel, Snow King, Snow Magic, Snow Princess, Sprague Last Chance, 
Spring Candy, Strawberry, Sugar Crisp, Sugar Giant, Sugar Lady, Summer 
Dragon, Summer Fling, Summer Lady, Summer Sweet, Summer Zee, Sweet 
Blaze, Sweet Dream, Sweet Henry, Sweet Kay, Sweet September, Tra Zee, 
Valley Sweet, Vista, White Lady, or Zee Lady variety peaches unless:
* * * * *

    Dated: July 21, 2008.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E8-16956 Filed 7-23-08; 8:45 am]
BILLING CODE 3410-02-P